Hazel loved her father dearly, but he was clearly not her role model, at least not in terms of handling money. Teddy ran a restaurant which did fairly well during the tourist season. However, during the off-season, he could barely meet his running costs.
Even a young Hazel could figure out that if one has a seasonal business, s/he must save the money for the lean months; but her father loved to splurge most of the money he earned during the season. Teddy spent a great deal of money on gadgets and bikes and cars, never learning from his mistakes.
While her father ensured that Hazel live comfortably and goes to a good school, she despised the months when money used to be scarce. For a person who loved to spend impulsively, Teddy would easily come undone when the cash-in-hand would be low, and would be irritable and ill-tempered most times, causing the household peace to ebb away.
An intelligent girl, Hazel learnt at a young age that better management of money is directly related to a family’s happiness. Opposed to her father, she never shopped anything on an impulse, and would always buy things that she needed and not wanted.
Whenever her father gave her some money to buy dresses and toys and treats, Hazel would put it in her piggy bank to be retrieved when she really needed it. Her habit of saving made her mother, Edra, happy, who worked hard at the family restaurant and resented Teddy’s extravagant nature.
Hazel dared to dream of a financially independent future. She wanted to create significant wealth for herself and her little family.
‘How would it be to know that millions of rupees are safely invested in my name – what self-assurance would it give to me?’ she often wondered.
While in senior college, Hazel got the opportunity to attend a financial literacy program conducted by a leading financial expert at her college. She immediately enrolled for the free program.
During his speech, the financial expert discussed how investing in mutual funds through SIPs can generate massive wealth over a decade. He said that rich or poor, anyone can create wealth by embracing financial discipline.
The program changed Hazel’s world. She met the expert after the event and anxiously asked him how can she take sure steps towards creating wealth when she grew up.
The expert told Hazel that she mustn’t wait to start earning to start building wealth. “It would be too late,” he said, “Start investing regularly from the allowances you are getting from your parents. Did you know that you can start with an investment as low as Rs 500 per month in mutual funds SIPs?”
Hazel hadn’t had the slightest clue.
In the next few days, Hazel obtained a free consultation with the financial expert and told her household story to him. After listening to her patiently, the expert, with inputs from Hazel, helped her set future financial goals which included her higher education, a small car and her wedding. He then showed her how much wealth she can accumulate if she invested in SIPs (of varying denominations) for the next 10 to 15 years. The possible returns showed by the expert seemed incredulous to Hazel, but the expert explained to her that the compounding factor in mutual funds makes it possible for the portfolio to keep growing in leaps and bounds.
Hazel started investing Rs 1,000 each month in a good equity plan suggested by the financial expert. As she finished her college and started to work at a local pharma company, she quadrupled her SIPs to Rs 4,000 a month. In just half a decade, Hazel’s portfolio started to show a robust growth each month. Seeing his daughter moving with long strides on the path of wealth creation, Teddy, too, decided to have a session with the financial expert, and, started investing regularly through SIPs.
Hazel, Edra and Teddy’s house is now happy all around the year, tourist season or not, the smiles and feeling of contentment shine from their home.
A little girl changed the fortune of a family. Can you?
Dr. Celso is a leading financial advisor in Goa. He is the author of five much-loved books and, together with his organization, Nave Marg Financial Consultants, a crusader for financial literacy among the people of Goa. He shares his time, knowledge and insights free of charge and can be reached at +91 9422058741.